But there are cases where we are moving away from a one-size-fits-all to a little bit more of a variation, and that really goes to the reequips, right. So if you have a store that is got a lot more members than the average, you are going to have to re-equip the cardio on the five-year cycle. And you probably, in some cases, may want to do that even earlier if it is getting beat up. And the same with strength. If your store is not quite as strong as you thought or just has less membership, then you would do it on a seven-year cycle and everybody else would be on the six-year cycle. So it is taking some of that into account so that the member experience is considered based on the usage essentially. And trying to get sort of store growth as an increased store growth as a, I will call it, a quid pro quo, not your – terms mine, but it is difficult to do.
We can’t really rewrite the ADA and the pacing of the ADA. This is to recognize – and it is also harder to find real estate. I think CBRE said it is the fourth year in a row of really record low’s center growth. So I think we are trying to factor in all those dynamics and really work with our franchisees to figure out what is the best combination of changes. While also on the get side, we want to move away from these grace periods. They are uncommon in franchising and going to more of a cure method allows us, to Craig’s point, to have better visibility and control over the pipeline. And so we have to transition from where we are to where we want to go, and it will take probably a few months to do that, but that is the intent. And we think, ultimately, this was the best set of changes that we could develop to improve – to free up some cash to invest in new store growth, improve the store returns of those new stores.
And we are excited about it. And so far, the reaction from franchisees has been quite enthusiastic. Now we have to go through and see how all that plays out and how many convert, but we feel the economics are compelling, and we will end up in most saying, yes. Is there more to come after this? I think – we think this is a big set of changes that is going to sit for a while, and we will continue to evaluate how the world changes, how the economy changes and how our business moves. I will tell you what we don’t want to get lost in all this is our business is performing well. member growth is strong. Profitability is up. We have got some timing on equipment that is impacting us across the quarters when compared to last year. But overall, I feel really good about the fact that three fourth of our same-store sales growth is driven by member growth.
We are opening orders of magnitude, more stores than our competitors. So it is just a – we feel good about a lot of things in this business. And ultimately, what we created, we think, is a win for us, a win for our franchisees and a win for our shareholders.
Operator: Our next question comes from the line of Joe Altobello from Raymond James. Please go ahead with your questions
Joseph Altobello: I guess first question, and I think I know the answer to this, is there anything you guys can do on the permitting and inspection side to accelerate that, or is it really out of your hands and it really just depends on the particular town?
Craig Benson: It is completely dependent upon where you are trying to locate. Some towns are very cooperative and other towns are very slow. And it starts with just getting the permit to start, and it goes all the way through the inspections. Second last club, I just opened 1.5 months or so ago. The guy decided the building a spec decide to go to Italy for a month and didn’t tell anybody. And so we couldn’t get into reset for a month waiting for them to come back from his trip that was unplanned. And so since COVID, some of the departments and some of the towns have taken a lot of new personality as far as expediting permits and inspections and certificates of occupancy. So it is you go in and you don’t even know what you are going to deal with till it starts.
That is the other thing because in my case, if you are going into a new town, you don’t know what to expect until you are in the process. And you hope for the best, but sometimes that doesn’t happen. Other towns are great. But it is – you don’t know. So it is difficult to project and different portions of the permitting process and the inspection process are run by different people, so that one section may be fine and another section may not be as fine. So it is all over the place.
Thomas Fitzgerald: Yes. And Joe, maybe one thing to add on that. In permitting some cases, you can use an expeditor and franchisees really like Craig, I want to get the store open, so they will do whatever they can. On inspection not so much. I mean there is nobody going to fast track that. But it is definitely more difficult than it is been.
Craig Benson: And it is difficult on us too because we have free rent periods, but if you are stuck not opening, those free rent periods expire and you are not even open to enjoy the benefits of free rent.
Joseph Altobello: Got it. Okay. And just maybe on the timing of a new CEO. I know it is obviously early, but how do you see that playing out? And what are you guys looking for in terms of qualifications? Is fitness experience a must or not necessarily?
Thomas Fitzgerald: So from what I hear, it is early. The process is going well. We are attracting some good interest. As far as the qualifications go, clearly, fitness were pretty well. I don’t think there is anybody bigger than us in fitness. So we can’t attract somebody from a bigger company, a fitness company, at least that would know more than what we know. But certainly, international experience is important to us. Consumer branding is important to us. Consumer marketing is important to us and perhaps understanding globally how we do all this, obviously, our public company experience is important to us as well.
Joseph Altobello: And would you expect someone to be in place before you provide guidance for next year or after?
Craig Benson: That might be a bit tight, but maybe. I don’t know exactly how fast this is proceeding. But I know that the Board who is running this process is very focused on doing a good job and moving it along.
Thomas Fitzgerald: It is always hard to predict, Joe, as you know, and I think to Craig’s point, this is an attractive role. Hard to find a place where you are eight-ish times bigger than your next competitor with lots of growth opportunity. But it is an important job, obviously, to make sure we take our time. I think we are providing guidance at the end of February. I think that as these things go pretty tight to Craig’s point. But I think the Board is moving with urgency, but not hastily.
Operator: Our next question comes from the line of John Heinbockel from Guggenheim Partners. Please go ahead with your questions.
John Heinbockel: Tom, can you talk about the mechanics of shifting from the grace period, right? Meaning, so if I’m on 1 now, does that continue? When do you transition over? Is it January 1st? And then does that have any impact, you think, on cadence of openings, one way or the other, whether pull it forward, push it out? And then relatedly, for Craig, right? As a franchisee, what do you think you need to see – others need to see to want to step up again? Is it – because maybe returns will never be what they were five years ago, that is fine relative to other alternatives? Do you just need to see stabilization and some modest improvement?
Thomas Fitzgerald: Yes, I will take the first one there, Joe. John, my gosh. We are moving through those changes here in all the documents. It is going to take a little while. We expect by January, we will be moving through that transition process by which the grace – whatever – if a store is in a grace period today, it will move to a cure method. And our intent is not to have a meaningfully different time line for that particular store than would exist under the grace period. We need to work to case individually. But that is essentially how we see it. So we don’t think it will affect the timing of new stores that are in process now. It is just a matter of transitioning from one to the other. [Al] (Ph) maybe defer to Craig on the what question.
Craig Benson: Yes. No, no. So thanks for the question. I love plan it as do all of our franchisees. And maybe I will take you back to the huddle where I talked about the 4 pillars of what we need to do together to make this brand even stronger than it is. And it starts with being aligned with our franchisees and having buying from both sides and frequent work together to enable us to be able to deal with this inflationary environment. It is not going to go away, at least not soon. And so we need to work together on different aspects of this model to ensure that we do the best we can. And so one of those areas is leverage. Our size is so big that we have never done a really good job of leveraging that for pricing, for opportunities to work with people directly.
